kevin sinclair's hong kong

PUBLISHED : Wednesday, 25 June, 2003, 12:00am
UPDATED : Wednesday, 25 June, 2003, 12:00am


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A minor item in the newspaper says a prominent restaurant has closed. Staff have lost their jobs. It has been a common occurrence in the age of Sars. The economics are simple. Outlets dependent on the tourist dollar have no customers. Empty tables and deserted bars mean no earnings. Without income, owners cannot pay wages or fixed expenses like electricity, insurance and, above all, rent.

This can be understood by the average six-year-old. But it is a concept that seems difficult to grasp for some landlords. A total refusal to accept the reality that we are now living in a different economic universe has meant the closure of a number of justly celebrated culinary icons.

A recent victim was the Kangaroo Pub, the jaunty Australian-themed watering hole that for three decades in different locations has quenched the thirst of thousands from Down Under.

Unless you frequented restaurants and bars which went under during the Sars earthquake, you probably didn't pay much attention to the death of an establishment.

Every closure was a mini-tragedy. When it became obvious that the landlord of the Kangaroo had no intention of budging from his rental demand of $47 per sq ft, investors knew they had no choice. After 14 years in the location, they sadly closed the doors of the pub in Hai Phong Road, Tsim Sha Tsui.

Stephen Anderson, the manager for nine years, wrote a note to the landlord. He told David Ma, of Gain Creation Enterprise Ltd, what it meant in personal terms to close an icon of tourism.

The letter cited recent press articles saying an unrelenting drive for wealth had removed the concept of social responsibility from some Hong Kong people.

Mr Anderson illustrated the human cost involved due to the landlord's unwillingness to negotiate.

The 18-year-old daughter of the barmaid, Imelda, was due to enter university; that noble ambition has been scrapped because her mother now does not have a job. Five staff members have children less than a year old. Five others are aged over 50. How will they find a job, Mr Ma, in the current market?

'The point of this letter is to remind you that your actions have an effect on a greater amount of people than you seem to care about,' the letter concluded. 'The request by the tenant was to lower the rent to market value. If you had agreed and attempted to support your long-standing tenant, all of the above people would still be in work.'

The Kangaroo is not an isolated case. According to the catering industry representative in Legco, Tommy Cheung Yu-yan, inflexible landlords demanding yesterday's sky-high rents in today's depressed markets have affected a number of restaurants. Neither Mr Cheung nor the government has figures, but industry sources list a number of Chinese and western establishments closed due to the intransigence of landlords.

The rent of $47 per sq ft is at the high end of current values, according to property agents.

Tsim Sha Tsui has been doing badly for several years because of massive, disruptive transport projects, the Asian economic crisis, the Iraq war and the threat of it and, the coup de grace, Sars.

And so the lamentable results. Yet another empty space in our tourism heartland. A dozen people out of work. A landlord who's getting no rent. One less attraction. Another turn in the downward spiral. Hong Kong tourism swirls closer to the plughole.